Parlt's economics committee okays scrapping electricity as universal service

TALLINN – On Monday, the economic affairs committee approved and forwarded to the plenary of the Riigikogu a bill that will allow the sale of electricity as a universal service to be discontinued as of May 1 this year.

The committee's chairman, Social Democrat MP Priit Lomp, said there was no longer a need for electricity as a universal service.

"Universal service was created to put a cap on the price of electricity and to protect residents from the very high electricity bills of two winters ago. Electricity prices have now come down, and those who stay on the universal service are worse off than those who are buying electricity at the exchange price -- by ending the service we are bringing down electricity prices for them and improving their livelihoods," the MP explained.

In October of last year, there were still 72,000 households on the universal service, while 87,000 households were buying electricity at the price of the universal service as part of the general service.

Vice chairman of the committee Lauri Laats noted that the Center Party group drew attention to the problem and initiated the corresponding bill already last year, but unfortunately it did not find support in parliament.

"As a result of the inaction of the governing coalition, 200,000 universal service consumers paid on average almost two and a half times more for electricity during the year, and the state earned a million euros of easy income from our people. The universal service did not justify itself, and the government should carry out a thorough analysis to assess whether and to what extent its creation helped electricity consumers in the first place," the opposition Center Party MP said.

The bill will also create a legal framework for the deployment of an electricity reserve capacity mechanism. In addition, it will include the costs of the running of the liquefied natural gas (LNG) mooring quay and related infrastructure in the strategic gas reserve levy, and the Competition Authority will have the right to open misdemeanor proceedings if it is revealed that a seller has resold gas purchased for the strategic gas reserve to a consumer at a price higher than the purchase price.

The standing committee proposed that the Riigikogu plenary handle the bill in the first reading on Feb. 14.